The Indian government is currently working on a universal pension scheme that will be available for all citizens of the country, including those in the unorganized sector. According to sources from the Union Labour Ministry, this initiative is to ensure that workers such as domestic staff, construction labourers, and gig workers who do not have access to the large government-backed savings schemes are also provided with financial security.
This is because, under the proposed framework, participation in the universal pension scheme is to be voluntary and the government is not to bear any financial burden. Rather, it intends to simplify the current pension-related schemes to form one structure. It has also been reported that the scheme will also be available to salaried and self-employed people.
At the moment, it is still being called the ‘New Pension Scheme’ and may even have its name changed to the existing one. The stakeholders’ consultation will only begin after the proposal document is ready, as government officials said.
Today, India has the New Pension System (NPS) that is available for all citizens, including Non-Resident Indians (NRI),
18 years and above, and 70 years and above. Companies can also join and allow their employees to enjoy the benefits of the scheme. The government has also put in place the Pradhan Mantri Shram Yogi Maan-Dhan scheme that provides for a minimum assured pension of INR 3,000 per month to unorganized sector workers. However, the beneficiaries must not be covered under the NPS or the Employees’ State Insurance Scheme and must not be income tax payees.
With the universal pension scheme, the government hopes to enroll millions of people in a structured retirement plan and therefore ensure that workers in all industries have some form of financial stability in their old age.
